The correlation between defect structure, metal segregation, and electrical resistivity of indium-tin-oxide nanopowder upon treatment in reducing atmosphere was investigated. Morphology and defect structure have been investigated by in situ synchrotron x-ray diffraction and transmission electron microscopy, while traces of metallic indium have been detected by susceptibility measurements utilizing the superconducting properties of indium. With increasing treatment temperature under reforming gas the film resistivity decreases down to = 1.6 ϫ 10 −2 ⍀ cm at 330°C annealing temperature. For even higher treatment temperatures, the resistivity increases further. This is accompanied by extractions of metallic indium. Under forming gas, grain growth could be observed at 350°C, while in air grain growth starts at 650°C. Furthermore forming gas causes a lattice expansion of ITO which persists in oxygen, at least for several hours. The results are discussed with respect to results published in the literature.